Making Home Affordable: Program’s Loan-To-Value Limit May Soon Change
The “Making Home Affordable” program introduced by the Obama administrationis may soon change to allow higher LTV (Loan-To-Value) ratios which in turn will open the program to more borrowers, particularly those with upside-down mortgages (mortgages where loan amount signifficantly exceeds the property value due to falling home prices).
The program is currently open to the borrowers who’s loan amounts are up to 105% of the property value and are owned or guaranteed by the Fannie Mae and Freddie Mac agencies, which are currently sponsored by the US government.
The Director of Federal Housing Finance Agency James Lockhart has acknowledged in a press conference that the current LTV limit of 105% is being re-considered, however he did not reveal the new LTV figure.
Media reports that LTV limit could be raised to as much as 125% which could theoretically include up to an additional 10% of the borrowers to qualify for the program.
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You never know what the “big brother” will do. thanks for sharing
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I’m not sure if that’s a good thing or not. Is’nt that how we got in this mess in the first place?
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It is a mess and I really hope and pray that we can turn this economy around soon.
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One wonders what it will take for the economy to turn around?
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I was just talking to a friend about the economy, and he was not very encouraging. His daughter was able to buy a 475K house on auction for 150K. It has probably gone down in value since then.
This is why I appreciate this blog. I will be reading about changes in financing and the housing market to stay informed.
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Update on my progress. I was able to reduce my interest rate, just by calling my lender. No added fees, credit check, or appraisal is necessary.
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Did that ever happen? I never heard anything official in regards to limits changing?
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That is one of the primary things that got us in trouble in the first place. We can’t just keep borrowing and printing money to try to get out of this mess.
I totally agree with you Sam.
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I hope this goes well. There are thousands of people that can benefit from this change.
I have not heard about this until now. I feel increasing the LTV would be a monumental mistake and only complicate things further.
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